Crisis Management: Tool Kit for General Counsel. Damon N. Vocke Managing Partner Sept. 18, 2017

Transcription

1 Crisis Management: Tool Kit for General Counsel Damon N. Vocke Managing Partner Sept. 18, 2017

2 OVERVIEW Role of In-House Counsel: Why Can t We Be Friends? Regulatory Matrix: The New Normal What On Earth Could Possibly Go Wrong? Law Enforcement Take Note Oh No What Now?

3 ROLE OF IN-HOUSE COUNSEL Business Partner Brad Smith / Microsoft Stephen Cutler / JP Morgan Gatekeeper Fiduciary / Ethical Duty of Loyalty Stephen Mayapolous (BofA / Merrill Losses)

4 ROLE OF IN-HOUSE COUNSEL The Organization = The Client Sarbanes-Oxley / Reporting Obligations

5 THE REGULATORY MATRIX. BEST HITS OF THE 90s IS SO PASSÉ. State / Federal / Int l Law Financial Reporting: False / Misleading / Inaccurate / Contingencies Primary & Secondary Violations: Aiding & Abetting Data Privacy / Protecting PII Trade Sanctions FCPA / Books & Records / Strict Liability

6 What On Earth Could Possibly Go Wrong? - JP Morgan / London Whale - Wells Fargo / Fictitious Accounts - VW / Emissions Scandal - Equifax / Yahoo / Target / Data Breach - Marsh / Bid Rigging

7 Law Enforcement. Take Note Yates Memo (2015): -Focus on Individual Culpability FRE 801(d)(2)(e): Imputing communications to coconspirators 18 USC 1033: Criminalizes false statements to insurance regulators

8 Oh No. What Now? Rule No. 1: Protect the Company s Best Interests The Psychological Aspects of a Crisis High Anxiety / High Stakes / Self-Preservation Personal & Professional Conflicts of Interest: Colleagues & The Company

9 Rule No. 2: The Game Plan Who s in Charge? Select the QB/Coach

10 Rule No. 3: Document Preservation Document Hold: Written / IT / Electronic & Hard Copy / Personal Devices? A Big No, No Obstruction & Spoliation

11 Rule No. 4: Protect the Attorney-Client Privilege -The Corporation Holds the Privilege -Protects Against Discovery -Disclose Internal Investigation Report?

12 Rule No. 5: Develop a Communication Strategy Bad News Travels Fast -Transparency: Regulators, Rating Agencies, Auditors, Shareholders, Customers -Internal Communications / Morale

13 Rule No. 5: Develop a Communication Strategy Managing the Press... Proceed with Caution No Comment Off the Record Deep Background Background On the Record PR Firm? A Big No, No False, Incomplete or Misleading Public Statements

14 Rule No. 6: Engage Independent Counsel, When Warranted - Quick & Dirty? - Independent Review The Pros and Cons -A Big No, No We Can Handle this Ourselves

15 Rule No. 7: Provide Written Upjohn Warnings Witness Interviews: Key Considerations Upjohn / The Corporate Miranda Warning Cooperation vs. Disciplinary Action Potential Conflicts of Interest A Big No, No Broadcomm & Failure to Warn

16 Rule No. 8: Avoid Recurrence Is the Problem Ongoing? Mitigation & Remediation Compliance & Governance Changes? Personnel Changes? DOJ Guidelines / Evaluation of Corporate Compliance Programs

17 Rule No. 9: Obtain Finality Parallel Investigations Civil Litigation Reputational and Financial Harm A Big No, No Death by a Thousand Cuts U.S. Attorney's Manual, Principles of Federal Prosecution of Business Organizations Deferred Prosecution Non-Prosecution Guilty Pleas

18 Rule No. 10: Avoid the Crisis Altogether Employee Training Tone from the Top Proactive Business Counselors Best Practices Right-size Compliance & Cybersecurity

19 Crisis Management: Tool Kit for General Counsel Damon N. Vocke Managing Partner Sept. 18, 2017